Startups are often created because founders are motivated to develop a unique product or service that can meet a specific consumer demand. And while some may argue that the ultimate goal of startups is to provide consumers with quality products and prove that these products are wanted, founders need to understand one crucial truth: some startups are created with the goal of acquisition.
From a financial standpoint, investors provide startup funding not to see innovative products come to fruition, but to get to a liquidity event. Liquidity might be achieved through an IPO, or through a (much more likely) acquisition by a larger entity. Investors understand that acquisition is a vital part of building a successful business, and to structure their brand identity and marketing content effectively, startup founders need to understand this too.
Founders who can visualize this long-term goal of acquisition are able to consistently add value to their brand in preparation. They can strategically plan when and how their branded media, online presence and product campaigns can work to not only generate leads and conversions, but also to make their brand more appealing to potential acquirers. Thinking through what makes a good acquisition is critical, and the good news is that this is a skill set you can learn.
Generate Interest in Your Brand
When (matter) partners with brands looking to be acquired, we walk our clients through specific checkpoints. Each checkpoint is necessary in the process of attracting interested companies, with one main goal in mind: to make the brand attractive through value, focus and strategy. If your brand needs to take steps toward generating acquisition interest, the (matter) team has created a list of steps you can take to help your brand get acquired.
- 1. What does your brand offer? Your brand should be valuable, unique, and focused. While acquisition is the long-term goal, your primary focus should be on delivering high-quality products and services. Providing concrete details and examples of how your brand can fill a product void, extend an existing product line, gain footing in a new market or demographic, or block competitors is key to attracting acquirers. You also need to be able to functionally diagram exactly how your brand generates and measures revenue.
- 2. Who do you want to acquire your brand? Familiarize yourself with your market and who your likely acquirers would be. Are there companies looking to acquire brands like yours? Knowing your industry and the major players within it will allow you to maintain a working list of potential acquirers. You can even get to know individual acquirers by approaching them much like a branding agency would encourage you to approach your target audience: talk with executives from brands that have already been acquired within your industry, and then talk directly with those acquirers to learn what types of data and growth they need to see to consider your brand for future acquisition.
- 3. Why should they acquire you? You must offer a product, fill a niche, or capitalize upon an opportunity for larger entities to notice your brand. Could your brand satisfy a financial or market share goal for your acquirer? Would your product enable your acquirer to or access a unique demographic or create a new niche within an existing market? Acquirers need to see how your specific company would help scale their existing business through acquisition.
- 4. What are you doing to capture acquirers’ attention? If you want to be acquired, you must make your brand known in the right way. High-quality, professional, and serious promotional materials that reflect your value are effective ways to catch the eye of potential acquirers. You might also consider submitting articles, blogs, or interviews to the digital media your acquirers typically read. Another keyway to capture the acquirers’ attention and disrupt the market is to create a professional essence for the brand. Some subtle ways to make your brand look more professional are having consistent branding efforts, creating professional business cards, and building a memorable business website. The more visible and elevated you can make your brand, the more likely that CEO’s will take notice of your company’s potential.
- 5. When do you want to be acquired? Some brands opt to sell early and cash out, while others choose to continue building their company. The longer you are in business, the more value you may accrue, thus increasing the money you could bring to an acquisition deal. When deciding if your brand wants to move quickly toward liquidity or wait and build value, it’s important to consider three key factors: your market, your best interests, and your investors’ expectations. Aligning these three factors will ensure that your business moves steadily toward an acquisition that satisfies everyone’s needs.
How Can (matter) Help with Acquisition?
As a branding agency, (matter) supports our clients with acquisition preparation by creating value for them. We begin by conducting multiple discovery sessions with internal stakeholders, interviewing top customers, and analyzing the industry landscape. We then synthesize this data within the context of our clients’ specific niches and industries to build a strong brand strategy that propels them toward acquisition.
In the past, the (matter) team helped Orthocare, Hydrotech and Standard Bariatrics evolve their existing marketing collateral and establish updated brand standards, website design and media content to prepare for successful acquisitions. (matter) also partnered with Tommy Armour Golf to revitalize the company’s brand identity and marketing materials, a strategic move that culminated in an increased market share and ultimate acquisition of Tommy Armour Golf by Dick’s Sporting Goods.
If pivoting your brand strategy toward acquisition seems like a gargantuan task, reassure yourself with the knowledge that preparing for a liquidation event doesn’t need to bring all your other brand objectives to a grinding halt. Rather, thinking through each component of acquisition carefully and strategically over time will allow you to make more informed marketing decisions as your brand grows. Need help or guidance to start this process? (matter) is no stranger to applying our branding agency expertise to support clients as they prepare for acquisition. Our team knows how to implement new brand architecture, craft powerful messaging, and develop compelling campaigns that equip brands for successful acquisition.
